The Indicator from Planet Money - A Face-Punching Legal Battle

Over the past few decades, the UFC has become the biggest name in mixed martial arts. But a lawsuit argues it has held down fighter wages by restricting competition.

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I want station card if this is the indicator from Planet Money can if you are a frequent listener, you might know that I am a fan of the sport of mixed martial arts MMA and also it's Stacy judge me for it a little bit like they're amazing athletes, but it's so violent part. It's like I just look forward to watch. I can't even watch the fighting. So for the onion doctrinated mixed martial arts is the sport that combines elements of boxing and kickboxing plus like wrestling things like takedowns and grappling. It is undeniably exciting to watch as Cardiff will tell you it's undeniably supervisor and it takes a huge toll on the fighters fighters like Kyle Kingsbury from 2008 to 2014 Kyle.

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In the UFC which is the biggest promotional organization that runs mixed martial arts fights. I've had two orbital blowout fracture in my left eye My Left Eye's actually 5 millimeters depressed compared to my right. My nose has been broken. I've had a separated rib torn right labrum, which required surgery. Do, you know arthritis in my knees hips? Very limited ankle Mobility on my right side. I think I might need reading glasses.

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By the way, Kyle is only 38 years old. So fighting taking a big toll on him physically, but it is the financial title of his time as a fighter that has been on his mind lately. I had to have multiple jobs the entire time. I fought as a professional athlete for a large portion of my career and lived in my mother's detached garage and I worked as a bouncer in a bartender at a local bar and I would stay up till 3:30 in the morning and I'd come home sleep for as long as I could and try to make it to morning practice on time and still get to training sessions in in a day and then head back to work and in between those training sessions. I was doing personal training out of my own home garage doors are underpaid is the subject of a legal battle that Kyle and several.

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Performer Fighters have been waging against the UFC for years and their lawsuit is one of the most intriguing labor market stories in the country. These former Fighters are alleging that the UFC has violated us antitrust laws and that the UFC has engaged in monopsonistic tactics. What that means. Is it according to the fighters do UFC has become so big and dominant within the sport that he can pose unfair contract on the fighters including restricting where else they can fight and leaving them with so few options that they have to accept those unfair terms the concept that Economist are increasingly paying attention to in the rest of the economy like a few years ago. When hospitals in Detroit colluded to hold down the wages of nurses the nurses didn't have other options of where to work in the city so they couldn't fight back as a monopsony. They sued and today on the show kind of the opposite of nurses suing. These are people who hurt each other for a living suing they give nurses business.

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Lawsuit in the face punching game and what it might reveal about the Dynamics of the labor market.

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This message comes from NPR sponsor avalara, providing cloud-based sales tax Solutions for businesses of all sizes. Abellera automatically integrates with more than 700 E R P & E Commerce system. Learn more at a valero.com indicator. Do you have she has an overwhelmingly dominant position as the biggest promotional organization that runs fights in mixed martial arts. It likely made close to a billion dollars in revenues last year and that's estimated to be as much as 90% of all the revenues in mixed martial arts and Achieve that dominant position by successfully managing and promoting a sport but also by buying out all of its biggest rivals in getting all of those top fighters from its Rivals to fight for it so that these numbers are not public but these estimates come from John Nash who analyzes the business and finances of mixed martial arts for the website the bloody elbow. He's our guide to this world and John says the lawsuit filed by the former fight.

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Against the UFC has unveiled all these documents that show what the fighters get paid. We are going we had an idea but now we have like concrete numbers here are some of the points made by the fighters and here are some of the UFC's counter-arguments first the fighters are they simply get paid a much smaller share of the UFC's revenues than athletes in other major sports leagues through those new documents from the court hearing revealed that Fighters get paid roughly 20% or less of UFC revenues in a given year for the major basketball baseball hockey and football league's athletes get paid close to half of what their leaves make other major combat sport. It's even higher close to 60% of boxing revenues goes to boxers and one of the reasons John says is it there were several major boxing promoters trying to sign Fighters. It's just a more competitive market. So for the UFC the fighter has to pitch the UFC to hire him to give him a fight because he needs to be in the UFC to make

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Where in boxing the promoter has to find a fighter and convinced him to let him promote him because he's the person drown the money.

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Getting smaller share of its revenues. The spiders are still getting paid more money over time because the UFC is making more in revenues over time. So the overall level of the fighters pay is still going up and down says if UFC were some other kind of company that response might be enough to win the case if the fighters are just like other workers and their pay is going up. Why would it matter if the fighters are getting a smaller share of the sports revenues than the athletes in other sports what makes this case different in this is what the plaintiffs are you is that the fighters aren't workers like a typical worker on a factory line. The fighters are the product as the product that's being sold. They deserve a share of the sales is still a young and growing sport should not be compared against established sports leagues + CRC make the case that a big reason to make so much money is not because of how great it spiders are but because of how good the UFC is at

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Sing on big lucrative fight nights that effectively the UFC has a kind of special ingredient that it adds to its fight cards. John Nash is a little skeptical of this one. But what is the special sauce is a little confusing in the UFC was claimed. It's their production. It's the way they do things but then can you be more specific because you know boxing does the same thing. They they promote Fighters they put on event. They they make packages that you know, all that stuff that seems to be part of the Special Sauce is done by other. No other promotions Fighters don't matter too much then why did the UFC go to such lengths to buy out its Rivals and get their Fighters and why does the UFC put restrictions in the fighters contracts to prevent them from fighting for other promotional companies? Look there's lots of other complexities in this lawsuit. For example, the UFC also makes it spiders accept a sponsorship deal with Reebok and keeps a lot of the money from that deal if I do.

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If they could get their own sponsors, which they used to be able to they would get paid more but really we're just scratching the surface here on this lawsuit and it probably has a long way to go anyways, but what is clear is it? The lawsuit is a fight about worker power. The former fighter say they lost power to negotiate their pay because the UFC made the market for their talent less competitive the UFC disagrees and his argue that it should not be punished for being a successful company. By the way. We emailed the spokesperson for the UFC about the lawsuit. They have not yet responded. What's also clear right now? Is it the financial life of a lot of UFC fighters is really hard Fighters were not highly-ranked will sometimes get as little as $10,000 for a fight and Fighters will have at most a few fights a year and they pay a big share of their earnings to their fight Camp places that run their training and provide coaching things like that. And so these former Fighters are basically suing the UFC for what they believe they're owed what they argue they would have made if the UFC had allowed.

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The competitive market for their services Nate Quarry one of these x-fighters says they're also hoping that the UFC has to change its approach to paying Fighters going forward. We deserve our seat at the table whether it's talking about sponsorships, whether it's a negotiating are our purses whether it's being able to fight for someone else free agency. That's what we truly need in this sport where the fighters will have the ability to really test out that remark and see what R-value is.

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Is that a certain indicator was produced by Jamila Huxtable? In fact check by Sean Saldana indicators edited by Patty Hirsch and is a production of NPR.
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